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JSE to contend with mixed Asian markets on Tuesday

31 March 2020 - 07:28 karl gernetzky

JSE. Picture: MICHAEL ETTERSHANK

The JSE faces mixed Asian markets on Tuesday morning, though there is some optimism in the market after Italy reported a slowdown in new Covid-19 cases and data pointed to an economic recovery in China.

A Chinese purchasing managers’ index for March beat expectations and registered an expansion after a dismal February, showing that country was recovering somewhat from the huge shutdowns implemented earlier in 2020 in a bid to contain the viral outbreak.

Tuesday marks the end of the first quarter, and there could be some volatility as traders assess their risk exposure, said Peregrine Treasury Solutions treasury partner Bianca Botes in a note.

There were signs that equities were finding support from the almost unlimited economic stimulus on offer from many governments, said AxiCorp chief Asia markets strategist Stephen Innes in a note.

Asian markets were mixed in morning trade, with Japan’s Nikkei down 0.37% and the Australian All Ordinaries index 1.6%, while the Hang Seng had added 1.09%.

Tencent, which influences the direction of Naspers, had risen 2.89%.

Gold was down 0.58% to $1,613.90/oz while platinum had risen 0.28% to $723.45. Brent crude was 0.53% higher at $22.57 a barrel.

The rand had weakened 0.21% to R17.936/$, while remaining flat at R19.76/€ and R22.21/£.

Focus remains on the viral outbreak and governments attempts to mitigate the economic damage. Italy on Monday posted the smallest number of new cases in two weeks, but also extended its lockdown to Easter, Bloomberg reported.

In the US, social isolation measures have also been extended until April 30, with cases surging in New York City.

Locally, SA enters its sixth day of a 21-day lockdown on Tuesday, with President Cyril Ramaphosa saying on Monday the government will act to support small businesses and employees.

Unemployment data for the fourth quarter is due later, and is expected to reflect that the fact SA’s economy was in a recession.